After NSG Waiver – What next?

Three developments after the NSG Waiver to India are really interesting – (a) Australia has clarified that despite the NSG Waiver, it will not supply Uranium to India till it (India) signs the NPT. (b) USA has requested India not to ignore US companies if US Congress doesn’t pass the bill on Indo-US Treaty during the current session. (c) China has proposed that Pakistan should also be given a similar Nuclear Deal.

Undoubtedly, the crux of this deal is supply of uranium and therefore Australian announcement is significant because they are the second largest producers of Uranium behind Canada. Tomorrow if other producers take a similar stand then the Nuclear Deal may lose its shine. The bright side is that India can always look towards Russia and other countries of the erstwhile USSR for uranium supply who are not likely to take a stand similar to Australia. Incidentally, the US produces only 4% of the total world production therefore it may not be in a position to supply huge quantities.

USA is worried that other NSG countries – particularly Russia, France and Germany would benefit from the NSG Waiver more than the US. However, it is highly improbable that the US would have gone all out to support India for the NSG Waiver without getting a behind the scene assurance from the Indian Government that US Companies would get lion’s share ahead of other countries. In spite of that, Condoleezza Rice’s request to India not to ignore US Companies sounded really funny. Even if she had to make that request she could have done that off-the-press. One wonders – what is the purpose of making such a request in public except to pre-warn other interested countries that US Companies would get a preferential treatment.

China’s show of support for Pakistan is obviously more of lip-service than anything else. However, it would be incorrect to interpret that their resistance to the deal was for this purpose. China obviously doesn’t want India to get the economic benefit of this deal.

While the high profile media coverage of this deal will not last long, let’s not forget that even if everything goes right, it would take at least 7 years for the first reactors to arrive. So it’s a long way before the real benefits of this deal can be seen on the ground. Even then, nuclear energy would still be a very small fraction of the total power generation in India. So practically it would not make any dent in the huge carbon footprint of the Indian power generation sector. Sadly, there are no viable alternatives to the coal based thermal power plants. With this reality in mind, Al Gore’s presentations on Global Warming sound very scary.

In the background, the left and right wing parties in India continue to oppose the Nuclear Deal, knowing fully well that they have lost the battle and whatever they may say will have absolutely no effect on the Indian Government.